Lawyer accuses Zespri of bid to nobble rival

By PHILIPPA STEVENSON

A lawyer for a company accused of illegally exporting kiwifruit says Zespri is using the case to nobble a competitor.

In the Auckland District Court on Friday, the Ministry of Agriculture and Forestry dropped one of four charges alleging breaches of kiwifruit export regulations by Australian-owned Oak Shore Holdings.

The five-year-old company, registered in Hamilton but run by Australian resident James Craig, pleaded not guilty to the remaining three charges involving six containers of fruit shipped between August and October last year.

Outside the court, Oak Shore's lawyer, Michael Gold, said the dropped charge was the one around which MAF had built most of its case.

"Really they haven't got any significant evidence that we've seen to support the other three charges," he said.

Gold said costs could become an issue because Oak Shore believed MAF could not support the allegations but had put the company to a large expense in researching the destination of the containers in Australia.

In May, major kiwifruit exporter Zespri said illegal exports to China alone were undercutting growers' returns by up to $3 million a year.

An Asia-wide blackmarket was widespread and worsening, said executive chairman Doug Voss.

Kiwifruit can be legally exported to Australia by exporters other than Zespri, which has the monopoly for the rest of the world.

Regulations are breached when exports are shipped from New Zealand ostensibly to Australia but in reality bound for other markets.

Gold said Oak Shore might not be the only company prosecuted this year in cases orchestrated by Zespri.

MAF had gathered a large amount of evidence on other companies which might be "waiting in the wings."

Oak Shore's prosecution was "part of a much bigger puzzle and Zespri are looking to stamp out the competition, as far as it goes, in Australia," he said.

"If they can bring charges to shut down the competitors to Australia, obviously that is going to help them because then they will be the dominant player in the market, if they are not already."



MAF Biosecurity Authority special investigations group manager Jockey Jensen rejected Gold's suggestion that MAF was doing Zespri's bidding.

"Certain people will suggest that we are the lapdog of Zespri, but the regulations are in place and if people breach them we have no alternative but to investigate those breaches."

Jensen said one charge against Oak Shore was dropped over the timing of the alleged offending.

It was unlikely to be re-laid and was not the substantive part of the case.

"Each charge is independent and there is no ranking amongst charges for that offence," he said.

Jensen said MAF's information came from a number of sources but a lot was co-ordinated through Zespri.

"That is fine by us because it saves us a lot of hard work initially. We have to check on the authenticity of some of [the information] because we need to corroborate some areas."

He would not comment on whether other investigations were being made, but said MAF would not ignore any breach of the regulations.

Zespri executive chairman Doug Voss labelled Gold's comments a "smokescreen".

Zespri could only place information before MAF, which decided whether to prosecute.

He would not respond to Gold's suggestion of anti-competitive behaviour apart from questioning the defence lawyer's motive.

"His job, I would have thought, was to defend his client in the court on the proceedings that are there. I don't know what else he is up to."

Australia was not an important market for Zespri, though it was for kiwifruit growers and the many exporters with whom Zespri worked in a "collegial way," Voss said.

"It's no big prize for us to be the dominant player in Australia. It is not one of our major markets, probably less than one or two per cent of our total sales."